ABSTRACT
This chapter describes the conditions that led to the takeover of power by the National Guard in 1968. It explains the steps taken by the Guard to consolidate its rule, with respect both to internal struggles for power and relationships with key political groups. Omar Torrijos nationalistic, confrontational style vis-a-vis the Americans gave his regime a store of legitimacy that he drew upon in facing the other political challenge--the building of political institutions designed to make crises of hegemony a thing of the past. The chapter explores the Torrijos regime’s approach to macroeconomic policy as a solution to economic growth in Panama. It discusses the regime’s foreign policy, with particular attention to the canal issue. The chapter examines Torrijos’s actions with respect to the other central item on the Panamanian political agenda--the building of stable and mass-based political institutions. A figurehead military-civilian junta was installed; the civilian members came from or were associated with the oligarchy.
